Abstract Despite broad acceptance among economists, carbon taxes face persistent public resistance. We measure the sources and distribution of welfare losses from unexpected European carbon price changes by estimating their impact on consumer prices, labor income, financial wealth, and government transfers. A 1% carbon-policy-induced increase in energy prices leads to an average welfare loss of about 0.5% of a household’s three-year consumption, primarily driven by indirect labor-income effects. Younger, poorer, and less educated households, especially in Southern and Eastern Europe, bear a disproportionate burden. These findings suggest public opposition to carbon taxes could stem from legitimate distributional concerns.

International trade and climate change are among the most pressing issues confronting the global community, with their complex interplay influencing economic growth, environmental sustainability, and international relations. This research paper explores the intricate relationship between these domains, focusing on the pivotal role of the World Trade Organization (WTO) in reconciling potentially conflicting agendas. Established in 1995, the WTO has been central to regulating international trade and ensuring fair practices; however, its framework intersects with environmental policies, creating significant challenges. The primary objectives of this study are to examine the integration of trade and climate policies within the WTO framework, to identify the challenges and conflicts that arise from this intersection, and to explore potential pathways for aligning these policies. The research aims to understand how WTO jurisprudence impacts the harmonization of international trade and climate policies and to provide insights into how these conflicts might be mitigated. The study reveals that the integration of trade and climate policies presents substantial difficulties. Carbon pricing mechanisms, such as carbon taxes and emissions trading systems (ETS), often conflict with trade regulations by increasing production costs and impacting global competitiveness. High-profile WTO cases illustrate how environmental measures can be perceived as trade barriers, highlighting the tension between environmental protection and trade liberalization. Additionally, issues such as border carbon adjustments and subsidies for green technologies have shown the need for a nuanced approach that aligns trade rules with environmental objectives. The research employs a comprehensive analysis of WTO jurisprudence, including a review of landmark cases and an examination of trade and climate policies. It uses qualitative methods to assess how trade regulations intersect with environmental measures and explores both theoretical and practical aspects of policy integration. The findings underscore the necessity of reconciling trade and climate policies within the WTO framework to promote a more sustainable and equitable global future. Understanding the implications of WTO jurisprudence on these policies is crucial for policymakers, trade negotiators, and environmental advocates. The research highlights the importance of developing coherent and integrated approaches to global trade and climate governance, suggesting that the WTO has a crucial role in guiding this process by clarifying the compatibility of environmental measures with trade rules, facilitating policy dialogue, and supporting innovative solutions. Keywords: WTO Jurisprudence, International Trade, Climate Change Policies, Trade and Environment Integration and Sustainable Trade Practices.

In response to global climate change challenges, both carbon taxes and emission intensity regulations are popular carbon pricing policies implemented in countries worldwide. These two carbon policies may impact industries differently, specifically the electricity and manufacturing sectors. This paper aims to investigate the optimal response of two industrial sectors to these carbon policies. The economic model is first calibrated by the cost structures, emission profiles, and market conditions typical of the two sectors. The equilibrium that captures the optimal production and abatement of firms is then given. In addition, by analysing the best response of industrial participants, insights for policymakers on effective carbon policies are provided in balancing environmental goals with economic considerations. Results reveal the significant influence of carbon pricing policies on industry profits, highlighting the need for tailored approaches for different sectors. Future research could explore the long-term effects of these policies on industry competitiveness and sustainability, informing ongoing policy development efforts.

An evolutionary game analysis about the low-carbon transition of power plants considering the carbon tax

The escalating demand for hydrogen forces hydrogen generation station (HGS) to seek a stable power supply, that is inherently contradicts the intermittency of distributed renewable energy (DRE). Whilst the affordable active distribution network (ADN) electricity mostly sourced from fossil fuels goes against decarbonization vision. To balance economy and emission, an efficient integrated power and hydrogen system (IPHS), featuring a full-cycle carbon tax and hybrid energy storage, is proposed. Particularly, the full-cycle carbon tax fosters optimized utilization of clean energies and development of high-efficiency solid oxide fuel cell (SOFC). The ADN involves li-ion batteries to derisk DRE curtailment. Whilst a two-layer optimizer is proposed to lower emission of the HGS, where the inner layer leverages a vehicle routing problem (VRP) to decarbonize hydrogen selling, and the outer layer serves to improve efficiency of hydrogen production and conversion. On privacy barrier, the ADN and HGS are unified by alternated directed multiplier method (ADMM), yielding a tri-level robust model. Given the integer-rich NP-hard nature of this model, due to 5-minute battery scheduling and inner VRP, a multi-time resolution solver is tailored. It segregates IPHS operations into a 1-hour ADN-HGS interaction stage following HGS’s slow responses, and an enhanced fast 5-minute battery schedule phase to compensate DRE stochasticity. Numerical studies indicate that, the proposed model reduces carbon emissions by at least 20.5% and operating costs by 7.6% across various seasonal scenarios.

The Emissions Trading System (ETS), modeled after the Kyoto Protocol, is widely recognized for its role in advancing the sustainable development goals (SDGs). However, this market-based mechanism has been criticized from a Keynesian perspective, which highlights that investment inertia in technology and climate governance can impede effective climate risk management. To address this debate, this study constructs a novel conceptual framework integrating institutional theory and the resource-based view. Employing a staggered difference-in-differences (DID) design with global data from 2000 to 2023, we empirically examine the complex relationship between ETS and physical climate risk. The results indicate that: First, the ETS, as a substantive climate governance tool driven by public pressure, significantly reduces physical climate risks, particularly acute climate risks. Second, the ETS governs climate risk primarily through three pathways-climate mitigation, adaptation, and finance-while also exhibiting spillover effects and threshold characteristics. Additionally, the effectiveness of the ETS is influenced by ideological and economic alignments, with notable variations among capitalist, non-EU, and non-OECD countries. Finally, high carbon prices, taxes, and allowances cause imbalances in the carbon market. This study not only provides a comprehensive explanation of the underlying mechanisms through which the ETS affects physical climate risk but also offers theoretical insights and empirical support for ETS optimization and the design of other climate policies.

Carbon tax policy reflects a strategic mechanism to align fiscal reform with climate goals. While previous research has extensively examined the political and economic implications of carbon pricing, limited attention has been paid to the strategic design of carbon tax policies towards balancing internal fiscal priorities with external environmental commitments, particularly in developing countries. This is particularly important in developing countries, where fiscal constraints and urgent development needs make the alignment with climate commitments extremely challenging. Therefore, this study addresses the research question: How do governments in developing countries navigate the strategic alignment between fiscal priorities and climate commitments in the design of carbon tax policy?. Using a qualitative case study approach, the research draws on in-depth interviews with 15 key informants involved in the design and implementation of the carbon tax policy in a developing country, Indonesia. Indonesia is a suitable case for this study because, despite having committed to reducing emissions through the Paris Agreement, implementation of carbon policy has experienced significant delays due to the slow policy design process. To address the research question, this study identifies a theoretical gap in the limited application of the Strategic Fit framework in fiscal–climate public policy in developing countries. Our findings show that fiscal alignment and climate commitments are hampered by short-term revenue interests, weak inter-ministerial coordination, and institutional capacity limitations, while international pressure and the push for fiscal reform are actually driving factors. Theoretically, this study extends Strategic Fit beyond corporate strategy to the public policy domain by incorporating fiscal-climate dynamics relevant to developing countries. Practically, it underscores the need for carbon tax designs that balance fiscal demands with climate commitments through stronger institutional coordination and credible instruments.

Abstract This study investigates the distributive effects of carbon taxation on household consumption in Spain, with a particular focus on regional and demographic disparities. By applying a multiregional input–output model across Spain’s seventeen autonomous communities and incorporating household heterogeneity, the paper evaluates the regressivity of a carbon tax imposed on all emissions embodied in final household demand. The analysis simulates a carbon tax of €100 per ton of CO₂, assuming full pass-through to consumer prices, resulting in an average increase of 3.9% in household expenditure. The findings confirm the regressive nature of the tax, as households in lower-expenditure and less densely populated regions experience a disproportionately higher burden. Moreover, the study reveals demographic variations: younger households are more affected by transport-related taxes, while older households face greater impacts from housing-related emissions, regardless of household composition.To address these inequalities, the paper explores various compensation mechanisms. It demonstrates that while incorporating social criteria—such as household structure or age—can reduce regressivity, these measures alone are insufficient. A more equitable outcome requires the integration of economic variables into the design of compensation schemes. The study concludes that public acceptance of carbon taxation hinges on the implementation of well-targeted, transparent, and economically informed redistribution policies. These findings contribute to the broader discourse on climate policy by highlighting the importance of balancing environmental objectives with social equity considerations in the design of fiscal instruments.

This study conducts a comprehensive comparative analysis of carbon pricing mechanisms across 47 jurisdictions implementing either emissions trading systems or carbon taxes during the period 2015 to 2025. Employing synthetic control methods and difference in differences estimation, we assess the effectiveness of these instruments in reducing greenhouse gas emissions while evaluating their economic consequences for output, employment, and competitiveness. Our findings indicate that carbon pricing at current levels achieves meaningful emissions reductions averaging 8.2% relative to counterfactual trajectories, with no statistically significant negative effects on aggregate GDP growth. Emissions trading systems demonstrate greater emissions reduction effectiveness (9.7% versus 6.4% for carbon taxes) but exhibit higher price volatility and administrative complexity. Carbon taxes provide more stable price signals and raise greater government revenue per ton of emissions reduced. Revenue recycling mechanisms significantly moderate economic impacts, with jurisdictions returning carbon revenues through dividend payments or tax reductions experiencing employment gains of 0.4% compared to those using revenues for general spending. The results support the economic viability of carbon pricing as a climate policy instrument while highlighting the importance of complementary policies addressing competitiveness concerns and distributional impacts.

Abstract To combat global warming, climate policies like carbon taxes, renewable subsidies, and carbon tariffs must be implemented to phase out fossil fuel consumption and lower emissions. Who are the winners and losers of such policies? Through a simple Integrated Assessment Model with heterogeneous countries and international trade in goods and energy, we study both the costs of implementing these policies unilaterally, and the local costs and global gains of international policy cooperation. To do so, we express and decompose welfare changes under different policy regimes to the first order as a function of sufficient statistics that depend on observables and identifiable elasticities like nations’ energy mix, energy rents, trade shares, energy supply and demand elasticities, and damage parameters. We show that climate change has non-trivial reallocation effects through international trade in goods and energy. Pursuing unilateral policies generates strong leakage effects, primarily through energy trade. Global climate policy cooperation mitigates leakage, but not all countries have an incentive to participate. Regional climate clubs operate differently: an EU-wide club reduces global emissions but creates internal winners and losers, while an ASEAN climate club achieves smaller global gains but delivers welfare increases for member nations.

Purpose The mobilization of financial resources through taxation, investment and external debt is essential for achieving sustainable development. This study fills the gap in understanding the dynamic linkages between taxation, external finance, investment and carbon footprint in developing countries. Previous research has mainly focused on carbon-specific taxes and static models. In contrast, this study examines how tax policies beyond carbon taxes (revenue and income taxation) affect not only emissions but also external debt and foreign direct investment (FDI), which in turn affect environmental outcomes. Design/methodology/approach A time-varying vector autoregression model in R is used with Moroccan data (1990–2022) to capture these evolving relationships. Findings The results show a significant time-varying Granger causality between fiscal policy, debt, FDI and carbon dioxide (CO2). The time-varying impulse response function shows that shocks in fiscal policy have inverse and time-varying effects on CO2, foreign debt and FDI. Practical implications Key findings include that a 1% increase in tax revenues reduces per capita emissions by 0.0047 to 0.0023 tons, while higher income taxes increase emissions by 0.01–0.021 tons, which is particularly important for developing countries with large populations. Each additional ton of CO2 correlates with a $9.06 billion increase in foreign debt. Income taxation reduces FDI by about 50 million dollars. FDI initially increases with emissions, but decreases once a certain threshold is exceeded. Originality/value This study illustrates the dynamic interplay of environmental economic theories and highlights the need for adaptable, timely tax strategies. It provides insights into the integration of tax policy into climate adaptation plans. It emphasizes the role of adaptive taxation in strengthening climate resilience and sustainable investment, especially in vulnerable developing countries.

Indonesia’s economy has long relied on non-renewable natural resources, which are now depleting, posing risks to long-term economic stability. The transition to a recursive economy—where resources are continuously reused and innovation drives sustainability—is critical. However, the role of policy innovation in facilitating this shift remains underexplored, particularly in integrating green economy principles, fiscal governance, and Just Energy Transition (JET) frameworks. This study examines how innovative policies can accelerate Indonesia’s transition to a recursive, post-resource economy. It fills a gap in literature by linking green government initiatives (e.g., fiscal incentives, R&D capacity) with economic resilience, while incorporating JET as a key variable. The novelty lies in synthesizing governance, technology, and diversification strategies into a unified policy model for sustainable transition. A Systematic Literature Review (SLR) is employed, analyzing peer-reviewed articles, government reports, and international case studies (2010–2025) on green economy transitions. Data is thematically coded to identify policy patterns, technological drivers, and institutional barriers. Findings reveal that: (1) Fiscal policies (e.g., carbon taxes, green subsidies) significantly boost renewable energy adoption; (2) Strong R&D investment correlates with faster industrial diversification; (3) JET-aligned governance enhances equity in transition outcomes. However, bureaucratic fragmentation and short-term economic priorities hinder progress. To achieve a recursive economy, Indonesia must: (1) Integrate green fiscal policies with JET commitments; (2) Strengthen cross-sectoral R&D collaboration; (3) Institutionalize metrics for long-term resilience. Recommendations include piloting circular industrial zones and aligning regional governance with national green targets.

This study examines the relationship between carbon tax payments, electricity production costs, and carbon emission indicators in coal-fired power plants (PLTU) in Indonesia following the implementation of the carbon tax policy in 2022. Using post-implementation operational data, this study applies a descriptive and associative quantitative approach, acknowledging the potential endogeneity and mechanical relationships embedded in emission-based fiscal variables. The results indicate that carbon tax payments are not significantly associated with electricity production costs, suggesting that cost structures remain dominated by coal prices and operational efficiency. In contrast, a strong positive association is observed between carbon tax payments and carbon emission intensity, reflecting the mechanical linkage between emission-based taxes and emission indicators rather than policy effectiveness. These findings imply that the current carbon tax in Indonesia functions primarily as a fiscal and emission-reporting instrument, rather than an effective environmental control mechanism. The study highlights the need for complementary policies, technological upgrades, and more robust empirical designs to properly evaluate the environmental effectiveness of carbon taxation

ABSTRACT Building structural designs, utilizing materials such as steel, concrete, and cross-laminated timber, contribute significantly to embodied carbon emissions in construction projects. However, traditional carbon accounting methods employed to quantify and record these emissions are often characterized by a lack of traceability, transparency, and immutability. This limitation undermines the reliability of emissions data, making it challenging for stakeholders to establish credible emissions records and implement regulatory strategies, such as carbon credits, taxes, subsidies, and green certifications, for building’s structural designs and materials. This paper addresses these challenges by proposing a transformational emissions accounting system that integrates Building Information Modeling (BIM) for automatic extraction of emissions-relevant data, alongside blockchain-enabled smart contracts to ensure traceability and immutability of emissions records. The proposed system enables data-driven decision-making for low-carbon structural designs and materials, while also facilitating the application of emissions regulations to support their implementation based on trustworthy emissions accounting.

Petrochemical hybrid renewable energy systems (PHRESs), integrating renewable and fossil energy sources, have garnered more and more attention for sustainable manufacturing. However, achieving concurrent optimization of energy supply reliability and carbon mitigation in these complex systems remains a critical challenge. This study proposes an innovative bilateral optimization framework coupling supply-side energy management with demand-side flexibility. On the supply side, a scenario-based two-stage stochastic programming method synergizes with energy storage systems to address renewable energy intermittency, considering a time-of-day tariff from the grid. On the utilization side, heat energy-based and shaft work-based energy interchangeability are introduced and leveraged to enable both qualitative and quantitative flexibility in process unit requirements and thus obtain energy consumption relaxation models for relaxing the design boundaries of PHRESs. These dual strategies are then coupled in a two-stage mixed-integer programming model framework for the optimal design of PHRESs. Applied to a large-scale refinery incorporating carbon taxation and dynamic electricity price, the proposed methodology demonstrates superior performance through five comparative cases. Compared to the Base Case, the Optimal Case using the proposed method can reduce the total annual cost by 14.82%, and stochastic programming reveals over a 40% probability of carbon mitigation in the uncertain space.

IMPACT This article shows that e-government is strongly associated with improved environmental sustainability, operating through transparency and corruption-control channels, particularly in urbanized and energy-intensive economies. Digital governance strengthens the effectiveness of carbon and energy taxes, while weak transparency amplifies the negative impact of energy subsidies. The findings highlight that successful energy transition policies (defined here as the shift from fossil fuel-intensive, subsidy-driven energy systems toward cleaner, more energy-efficient and price-based energy regimes supported by carbon and energy taxation) require strong e-government systems that reinforce accountability and reduce governance-related inefficiencies.

Transportation accounts for nearly one quarter of global greenhouse gas (GHG) emissions. A significant proportion of transportation emissions can be attributed to supply chain transport, which also represents the fastest-growing sector of emissions. As a way of addressing this challenge in the effort to combat global climate change, many local and national governments have leveraged public policy in the form of carbon taxes, emissions trading systems (ETSs), and subsidies for heavy goods electric vehicles (HGEVs). Firms affected by these policies are thus faced with higher costs for more emissions-intensive supply networks and a lower barrier to entry towards adopting HGEVs. However, the exact policy conditions under which firms would be most motivated to change their behaviors remains unclear. In this paper, we develop a novel methodology to address this obstacle in the form of a bi-objective green vehicle routing problem. The first objective is the minimization of the total cost of transportation over a set of vertices comprised of a depot, customers, and charging stations; the second objective is the minimization of total GHGs emitted during transportation. The proposed approach considers the three policy instruments and their effects on both fleet mix decisions (i.e., the conditions under which a firm is most motivated to adopt HGEVs) and cost- and GHG-minimizing routing options. Via an analysis of the change of the Pareto frontier given increasingly stringent carbon pricing and/or increasingly generous HGEV subsidies, firms may consider routing options that yield the most significant GHG emissions reduction at the lowest cost. To this end, we provide a survey of current and forecasted global trends related to carbon tax rates, ETS carbon allowance prices, and HGEV subsidy amounts.

Measuring corporate contributions to climate change is often crucial for investors, policymakers and legal frameworks. Current methods use attributional carbon footprint metrics, which quantify emissions linked to a company's activities. Despite its widespread use, this approach faces challenges like ‘brown spinning’ and fails to account for substitution effects. In response, some advocate for consequential metrics, which consider alternative scenarios and counterfactuals to measure the impact of corporate actions on global emissions. This paper critically examines both approaches, arguing that while attributional metrics are flawed, consequential metrics often require infeasible levels of predictive precision and counterfactual analysis. We propose that different contexts and purposes warrant different approaches. For some purposes and contexts, like carbon taxation, a restricted attributional method that focuses exclusively on Scope 1 is suitable. For other purposes, like setting Environmental, Social, and Governance ratings, we suggest an elaborated attributional framework that also accounts for indirect causal contributions not captured by standard Scopes 1–3 emissions. In yet other cases, standard or elaborated forms of consequential metrics may be more suitable.

Air pollution has become a pressing global challenge that threatens ecological security, public health, and sustainable socioeconomic development, prompting extensive academic and policy attention on air pollution control and environmental governance. To systematically clarify the knowledge structure, evolutionary trends, and interdisciplinary characteristics of this field, this study employs bibliometric methods combined with CiteSpace, VOSviewer, and Tableau tools for in-depth analysis of the global literature published in the last 25 years. Key dimensions including keyword clustering, co-occurrence networks, national cooperation patterns, journal co-citation relationships, and policy evaluation methodology evolution are explored. The results reveal that research output in this field has maintained sustained rapid growth, with distinct interdisciplinary integration across environmental science, economics, energy engineering, and public health. Notably, the evolutionary path of research themes presents a clear transformation: shifting from early emphasis on “emission standards” and “end-of-pipe treatment” to market-oriented policy instruments such as “carbon tax” and “carbon emission trading”, and further expanding toward systematic solutions including “green finance” and “collaborative environmental governance”. In terms of policy evaluation methodologies, there is a developmental trend from single-indicator monitoring to integrated assessment frameworks combining quasi-experimental approaches (e.g., difference-in-differences, regression discontinuity design) and multi-model coupling. Furthermore, national collaboration analysis identifies China as a core hub in the global research network, while European and American countries maintain advantages in research impact. While this observation is based on absolute metrics, a data normalization approach (e.g., by population) reveals more distinct relative differences and a complementary global dynamic: China’s scale-driven output aligns with large-scale, engineering-intensive governance challenges, whereas the markedly higher per capita research impact of Western nations reflects a deeper focus on policy innovation and systemic mechanisms. Burst term detection highlights emerging frontiers such as the “Porter hypothesis”, reflecting growing focus on the synergistic relationship between environmental regulation, green innovation, and economic development. This study also identifies critical research gaps, including insufficient attention on cross-regional pollution transport policy coordination and emergency policy evaluation under extreme weather conditions. The findings provide a comprehensive academic map of global air pollution control and environmental governance research, offering valuable insights for optimizing environmental policy design, promoting interdisciplinary collaboration, and guiding future research directions in this field.

A high-quality grain distribution system is the key to guarantee the balance of grain supply and demand, and the reduction of greenhouse gas emissions in grain transportation is the concern of the government and enterprises. In order to clarify the influence of different low-carbon policies and loading modes on the optimization of grain multimodal transport paths, this paper constructs a low-carbon grain multimodal transport path optimization model with the objective of minimizing transportation, cargo loss, time and carbon emission costs. Taking Jiamusi City, the main grain producing area in China, as an example, a heuristic genetic algorithm is used to solve the model to explore the impacts of carbon tax policy (CTP), carbon emission trading scheme (ETS) policy and carbon offset policy (COP) on the transportation schemes of grain in three loading modes, namely, “bagged, bulk and containerized”. We analyze the effects of carbon price fluctuations on decision-making under low carbon quota, medium carbon quota and high carbon quota scenarios, and study the effects of different cost preference values on transportation decision-making under the ETS policy. Under the ETS policy, the optimal transportation path of each loading mode has the lowest total cost, and the total cost is reduced by 1% compared with that of carbon tax and carbon offset policy. Among them, the containerized rail-water intermodal transportation scheme has obvious cost and environmental advantages, with the total cost decreasing by 42% and 33% compared to bag and bulk, and the carbon emission decreasing by 27% compared to both. With the overall relaxation of the time window, the transportation scheme is transformed from road-rail intermodal transportation to rail-water intermodal transportation. In addition, when the carbon price is RMB 2/kgCO_2 and above, it can promote the transportation transition to low-carbon rail-water intermodal transportation, and the high carbon quota under the ETS policy can motivate enterprises to realize cost reduction and efficiency. The findings of the study can provide reference for grain transportation enterprises to formulate multimodal transportation solutions and provide theoretical support for the government to formulate low-carbon policies.